An employment contract may be terminated by:
- the death of the worker;
- on the mutual consent of the employer and worker;
- when the worker is 65 years old and with at least 15 years of work with paid pension benefits (in accordance with regulations related to pension-invalidity insurance), unless agreed otherwise by employer and worker;
- when the worker has worked for 40 years with paid pension benefits (in accordance with regulations related to pension-invalidity insurance), regardless of age, unless agreed otherwise by employer and worker;
- declaration of invalidity by the competent authority;
- termination with notice (ordinary) by employer;
- termination without notice (summary dismissal) by employer;
- termination by employee;
- the lapse of time (in the case of a fixed-term employment);
- if a worker is sentenced to prison or is subject to a safety or protective measure for more than three months; or
- a final and binding court decision terminates the employment.
6.1. Formal requirements for the employer
Written form and reasons for termination
If the employer wants to terminate the employment relationship, it must do so in writing and should state the reasons for the termination. Non-compliance with these requirements may result in the termination being invalid.
6.2. Periods of notice
At least 7 days (for the worker) or 14 (for the employer)
The minimum notice periods for termination of an employment contract are at least 7 days for the worker and 14 days for the employer. Furthermore, the notice period for probationary work is at least 7 days, as per the applicable law.
Entitlement to remuneration during the notice period
During the notice period for termination of employment, workers are entitled to full remuneration and all other statutory rights.
6.3. Dismissal without notice
Serious breach of duty
The employer may terminate the employment contract without notice if the worker is liable for a serious breach or serious breach of work obligations from the employment contract, and if said breaches are of such nature that the employer cannot be expected to continue the employment relationship. In case of less serious breaches of employment obligations, the employer cannot terminate the employer’s employment contract in writing without giving a prior warning.
If there is a valid reason for a summary dismissal, the worker must be dismissed within 60 days, but no more than one year from the day of learning about the fact causing dismissal.
6.4. Causes for dismissal
Termination by employer
Employers may only terminate a worker’s employment contract in accordance with the reasons given in the applicable law.
Reasons for termination
The employer may terminate an employment contract under the prescribed notice period in cases where:
- termination is justified due to economic, technical or organisational reasons (in this case the employer may terminate the employment contract if, taking into account the size, capacity and economic condition of the employer and the worker’s capabilities, it cannot be reasonably expected from the employer to give the worker other jobs or educate or equip him for work in other jobs); or
- the worker is not capable of carrying out his employment contract obligations.
Possibility of continued employment
An employer may only terminate the employment contract of a worker who has reduced working ability or who is at immediate risk of disability with the previous consent of the workers’ council or trade union.
6.5. Mass redundancies
If an employer employing a minimum of 30 workers intends to terminate the employment contracts of at least 5 workers for economic, technical or organisational reasons within the period of the next three months, then this represents “collective redundancy”.
In these circumstances, the employer must consult with a workers’ council or trade union.
6.6. Severance pay
2 year term
If a worker who concludes an employment contract for an unlimited duration and this contract is terminated by the employer after a minimum of two years of continuous work (except if the contract is terminated due to breach of employment obligations or non-performance of employment obligations by the worker), then the worker is entitled to severance pay to an amount depending on his years of continuous employment with that employer. Severance payment is determined based on the collective agreement, employment rulebook or employment contract, but it cannot be an amount lower than one-third of the monthly average salary paid to the worker within the last three months prior to termination of the employment contract for every year of service with this employer. The severance payment may not exceed six average monthly salaries paid to the worker in the last three months before the termination of the employment contract.
6.7. Special dismissals protection
Groups protected against dismissals
In FBiH, workers who belong to the following groups may not be made redundant:
- pregnant women, parents during maternity/paternity leave, as well as parents of disabled children on care leave; and
- workers who have suffered an injury at work or have become ill with an occupational disease and are incapable of working.
Termination only permissible with the approval of the federal ministry of labour
For the duration of their union activity as well as for six months thereafter, union members may only be dismissed with the permission of the federal ministry of labour.
6.8. Alteration of occupational circumstances
Altered occupational circumstances of a worker such as changes in working ability due to an injury at work or a work-related illness cannot damage the rights of a worker as arising out of an employment contract. If, after appropriate treatment, the worker is declared as fit for work then he is entitled to return to perform the jobs which he performed prior to his inability to work or do other jobs corresponding to his occupational circumstances, meaning work ability. If the relevant medical institution determines that the worker possesses decreased working capabilities or there is a direct danger of disability, the employer is under a duty to offer to him in writing other jobs which the worker is fit to do. This worker is entitled to an advantage in terms of competency education, training and further schemes to improve performance, as organised by the employer. An employer may only terminate the employment contract of a worker with reduced working capabilities or who is in direct danger of becoming disabled with the prior written approval of the workers’ council or trade union.